HPE’s Ulrich Seibold: HPE Is Building A ‘New Market’ With AI As A Service

Seibold expects the Nvidia AI Computing By HPE offering including the HPE Private Cloud AI to expand the total addressable market for the Powered by HPE GreenLake service provider business alone by $1.5 billion to $2 billion.

HPE Vice President of Global GreenLake Partner and Service Provider Sales Ulrich Seibold says the breakthrough jointly developed Nvidia AI Computing By HPE Private Cloud AI is poised to unleash a new AI-as-a-Service market opportunity for partners.

“Today it is a hyperscaler and a service provider game,”
said Seibold. “Our typical value-added reseller has not been heavily involved in the AI opportunity. This was not their core focus. Now they can use this fully integrated turnkey solution [from HPE and Nvidia] and start immediately [building AI solutions for their customers].”

HPE Private Cloud AI with a GreenLake pay-per-use model offers big advantages for customers that could get clobbered by the high cost of building out a public cloud AI solution, said Seibold.

“With AI we are entering a new world,” he said. “No one can say whether [their AI solution] will double or triple in a year. So the customer needs to start small. We provide an as-a-service model so the customer does not need to invest hundreds of millions of dollars without knowing if that is the endgame. So customers can start small with HPE GreenLake and pay for what they use. It is a fully integrated and managed platform. This is entering a new game.”

Here is an excerpt from the conversation with Seibold.

With HPE Private Cloud for AI, how much have you reduced the high cost barrier to entry and the time to market?

Think about our partner community and what our partners are doing. Normally they want to build something individual [for the customers]. So they need to think about what is the technology architecture from a hardware perspective, then they need to think about how to integrate the hardware from a security perspective to manage the operations. Is it integrated in other end customer environments? Then they [would have to integrate] the full Nvidia enterprise stack.

If you think about AI, it’s all about data. It’s about data management. So we include the full Ezmeral Data Fabric as well as the [Ezmeral] Management Architecture in that environment as well.

If you think about a normal [AI] project in the past, bringing all that together was hundreds of hours of design and even after that it’s still not implemented. Now [with HPE Private Cloud AI] it’s fully implemented and fully integrated.

Now they can start immediately integrating the data and implementing the right ISV application on top of it. It’s all about the ISV. Now they can start immediately creating AI opportunities in an end customer environment.

I would say partners can save hundreds of hours–maybe thousands of hours–I don’t know, to be fair. Also, think about what can go wrong if every partner selected their own [AI] environment. Then it is a trial-and-error game. They do not have the experience with data management integration or the Nvidia software.

With HPE Private Cloud AI, it is secure and fully integrated. Before, it was months before they were operational until they built this individually for customer. The TCO is phenomenal.

How big is the opportunity for partners selling HPE Private Cloud AI and the Nvidia AI Computing By HPE portfolio?

For my service provider business alone, the TAM [total addressable market] is going up by $1.5 billion to $2 billion.

And then there is the reseller part of this. Today it is a hyperscaler and a service provider game. Our typical value-added reseller has not been heavily involved in the AI opportunity. This was not their core focus. Now they can use this fully integrated turnkey solution [from HPE and Nvidia] and start immediately [building AI solutions for their customers].

Before, it took weeks, months and even longer. Now they can start immediately.

End customers have been looking for a final solution [that can be implemented quickly] and partners have not had a good answer. They had answers but not good answers. Now they can start and focus on the ISV, the integration, the processes behind data collection and driving business value for the end customer.

This is total game-changer. I believe most of our future investments in enterprise and below will go into this space because customers are going to start changing their application environment.

In the future new ISVs will be coming up. Starting now, partners selecting the right applications will be in the forefront of a total new business model.

We have heard about high-performance computing with AI training and inferencing. That is now our game. Before, it was a niche, to be fair a big niche, with billions of dollars but only for a selected number of hyperscalers and some big partners.

Every customer will start small because you cannot start with a small environment. That’s why we have these configurations: small, medium and large.

With the as-a-service model, customers do not have to invest millions and millions of dollars. They can start small and grow as they go.

What is your call to action for partners with this new Nvidia Computing By HPE portfolio?

Think about what we did with HPE GreenLake. We built enablement training for partners to show them how to create an as-a-service business.

Those partners that went through those trainings grew 89 percent after they attended a training and they were doing 60 percent more repeatable business. So they are seeing more GreenLake opportunities.

We are using exactly the same method and training we have adapted now for AI. That is one element: the enablement to show partners how to build a business around AI.

The second element, which is super unusual and we never did it before, is we have consulting capabilities around how to [help customers] create business value out of data. Our consulting organization and all our BUs [business units] involve the channel. We have built a curriculum and training method and selected partners are attending. They needed to be qualified.

Not all partners have passed because they are just selling a product. That is not what we want. We want [partners doing] full -stack AI implementations.

We have used the GreenLake method as enablement. Then all our presales, consulting and selected partners will all go through the same training.

They are all in the same boat and the same training. In a couple of weeks from now we will have hundreds trained on the new infrastructure turnkey solutions. This is something I have never seen before.

How critical is the GreenLake platform to the HPE Private Cloud AI solution?

It is the full integration of our HPE GreenLake platform. It’s turnkey. So you push the button and you are in the GreenLake platform. With [HPE] OpsRamp [IT operations platform] you have access to the full operational environment–both traditional IT and access to the hyperscalers. Most partners are hybrid. So they have access to the hyperscalers managed through the [GreenLake] platform through OpsRamp. So it is not an island or an isolated AI chest.

From the first day it is 100 percent integrated into the enterprise infrastructure application management. Think about what this means. In the end they need to have access to the data. We want to build [AI] models for the customers. This is the real savings behind this platform. That is what makes it so fantastic that we have these solutions.

How important is the OpsRamp integration with this HPE Private Cloud For AI offering?

For years we have been talking about hybrid cloud management. The world is hybrid now, as we all know. That is why we have this advantage with OpsRamp.

We integrate all the legacy systems by definition through OpsRamp. We can manage all hardware. We can manage more than 2,000 applications. We can manage all the hyperscalers.

We are collecting all this data for AI from all these different environments and systems, all going through the GreenLake platform. This is the melting pot of everything we are doing in the future.

How important is it that this is the first-ever co-branded HPE offering with Nvidia AI Computing By HPE?

With the integration and the GreenLake as-a-service model, I believe we are building a new market. If you think about it, many partners and customers are buying traditional solutions. They normally know what they are buying and the size of the applications.

Now with AI we are entering a new world. No one can say whether [their AI solution] will double or triple in a year. So the customer needs to start small. We provide an as-a-service model so the customer does not need to invest hundreds of millions of dollars without knowing if that is the endgame. So customers can start small with HPE GreenLake and pay for what they use. It is a fully integrated and managed platform. This is entering a new game.

When will the new HPE Private Cloud for AI be available?

It is orderable at the beginning of next month. It is not a development. It is ready. It is not an announcement at Discover that will take six months. It is orderable at the beginning of July and we ship in our Q4 [which ends Oct. 31].

It is fully designed, fully operational and orderable with shipment in the mid to the end of Q4. That is outstanding. We can now start selling. That is why this is so important.

It is there and we have partners already asking to be trained. We announced it to selected partners this morning. It is phenomenal.

Does this expand the GreenLake opportunity for the business?

I mentioned the TAM for service providers going by $1.5 billion to $2 billion, which is only for my current service provider business. Think about what we are doing every quarter in compute and storage in a traditional way. Now with the AI solution we are bringing it all of it together.

I assume the majority will go in an as-a-service model. We talked about the benefits since they do not know how fast it is going to grow.

This is a huge shift into as a service and we have the advantage compared to all our competitors.

The announcement includes deals with global systems integrators [Deloitte, HCLTech, Infosys, TCS and Wipro]. What impact is that going to have on the go to market?

The GSI [global systems integrator] part is so important for us because at the end of the day it is about the applications, the ISVs and the data integration. You need to have the same quality across the globe. That is why we selected those big GSIs. This will help us a lot to have a data integration layer from the first day on a global scale.

They are starting now to build AI practices. This takes time. The market is here now. That is why we started with the GSIs. Now we will expand with training and the methodology through our system houses, resellers and service providers.

Partners are able to do data management, operate, integration, data management, hybrid cloud. We often talk about the back end. That’s just a nice element. The real margin is on the consulting, on the operations side and the customer intimacy they are getting. So it is a huge opportunity. I would say 40-plus percent [margin].